As the Rich Do Without Extras, Service Workers Do Without

By STEVEN GREENHOUSE

Published: November 29, 2001

A nanny on the Upper East Side had her work schedule cut to three days a week from five because the wife in the household lost her job on Wall Street. Limousine drivers complain of carrying fewer passengers and earning 40 percent less than they did before.

At many top restaurants, waiters are working just three days a week instead of five. And bellhops at Manhattan's five-star hotels say their tips, which often account for half their income, have plummeted by half.

These workers are part of a huge yet largely overlooked segment of New York City's ailing economy -- estimated by economists to number 75,000 workers -- who have suffered badly since the Sept. 11 terrorist attack on the World Trade Center. These 75,000 workers -- separate from the 80,000 who have been thrown out of work since the attack, according to state figures -- have experienced a painful drop in income because, while holding onto their jobs, they are working fewer hours, carrying fewer passengers and receiving lower tips.

Economists assessing the ripple effects of the Sept. 11 attack originally focused on the surge in unemployment, but they are now beginning to examine this other large group of workers, studying how their shrunken incomes will add to New York's steep economic losses. The financial troubles faced by these workers will go far to reverse the good times that many low-income workers experienced over the past decade. Despite their economic suffering, many of these workers fail to qualify for any assistance, and their declining incomes will have a cascading effect, hurting retailers and landlords alike.

''There's a whole level of hardship that's not being captured by the employment data, including the unemployment numbers,'' said Mark Levitan, a senior policy analyst at the Community Service Society of New York. ''It's going to have a fiscal impact because there will be less tax money going into the city treasury. And there's going to be a severe impact on low-income neighborhoods, like Downtown Brooklyn and 125th Street, that have had significant gains in the last five good years we had.''

Nazir Khan, a limousine driver, complains about a plunge in business because his company is receiving fewer calls to pick up Goldman Sachs and Morgan Stanley bankers, or passengers on the US Airways shuttle. His weekly gross has fallen to $600 from $1,000, out of which he pays more than $200 a week for gas, insurance and car payments.

Wealthy passengers, Mr. Khan said, have grown more tightfisted. ''Fewer people are giving tips by far,'' he said. ''Let's say on the average I would get $20 to $30 a day in tips. Now if you get $5 to $10, that's a lot.''

Many financially squeezed workers -- limousine drivers, butlers, housekeepers, waiters, nannies, bellhops -- have been hurt by a wholesale belt-tightening by the city's well-to-do. Wealthy New Yorkers were badly shaken by Sept. 11 and the subsequent economic slump, so not surprisingly they cut back their spending.

''New York, like London and other global cities, has always had a luxury service class that relied on a healthy upper class,'' said Joshua B. Freeman, a historian at Queens College. ''When that upper class catches a cold, those who rely on them catch pneumonia.''

Mr. Khan is a prime example. To make ends meet he now often works 18-hour days, from 6 a.m. until midnight, instead of 14 hours as he did before Sept. 11. He has told his two teenagers to forget about buying the latest Nike styles and the hottest CD's, advising them that they do not have to buy name brands and should buy only what they need.

''This is the hardest period that I've ever had here,'' said Mr. Khan, who immigrated from Guyana 10 years ago.

Luis Molina, a taxi driver from Puerto Rico, faces a similar squeeze. He said his financial district business has fallen most, helping drag down his daily gross to $170 from $250 -- before he pays $75 a day to lease his cab.

''I used to have a slew of stockbrokers,'' Mr. Molina said. ''They were good tippers. A lot of them brought their mistresses along. They'd want me to take them to the nearest hotel. That's changed. I think they've stopped partying.''

Some of the 50,000 taxi and limousine drivers in the city say they are making only slightly more than half what they were before Sept. 11 but working longer hours. Add to that the thousands of waiters, bellhops, nannies and others suffering from shrunken paychecks, and some economists say the estimate of 75,000 people in this group may be conservative.

Many of these workers complain about slipping through the safety net and being unable to qualify for aid like unemployment insurance, usually half of their weekly pay. And this group also complains that the unemployed have an easier time obtaining government health insurance, like Medicaid.

''The safety net that we have isn't designed for this gray area,'' Mr. Levitan said. ''We have this new twilight zone of people who are formally employed. They work too many hours for unemployment insurance, and their incomes are too high for public assistance or food stamps, yet their incomes have been hurt severely.''